Although NAND flash market demand was sluggish in the beginning of the third quarter of 2012 due to slow economic recovery worldwide, Toshiba’s July announcement of capacity cuts and the arrival of Apple’s iPhone 5 in September provided positive market stimulation. Subsequently, in the latter half of the third quarter system product OEM clients’ inventory restocking demand began to pick up, and supply became slightly tight on the NAND flash market, as reflected in the rebound of NAND flash contract prices in September. According to DRAMeXchange, a research division of TrendForce, in the third quarter of 2012 NAND flash brand suppliers’ average selling price (ASP) declined by 3% QoQ, while bit shipment volume rose by 10% QoQ. Total NAND flash brand manufacturer revenue reached 4.626 billion USD, a 6.6% QoQ increase compared to the second quarter.

Looking at the 3Q12 sales ranking for branded NAND Flash manufacturers, Samsung remained in first place with US$1.821 billion, 39.3% market share; Toshiba took second place with US$1.21 billion, 26.2% of the market; Micron came in third with US$666 million, 14.4% of the market. SK Hynix was fourth at US$535 million, 11.6% of the market; and Intel placed fifth with US$395 million, 8.5% of the market.

Samsung
Benefitting from inventory restocking demand for the release of new products such as smartphones and tablet PCs in the third quarter, Samsung’s bit shipments increased by over 10% QoQ, but the maker’s ASP fell by 10% QoQ. Thus, Samsung’s third quarter revenue increased by only 1.8% QoQ, arriving at 1.821 billion USD, giving the maker 39.3% market share. As Samsung anticipates new smart mobile devices hitting the market in the fourth quarter will cause relatively tighter supply, the Korean maker intends to increase the sales proportion of embedded products and SSD as well as the production ratio of 21nm process technology products. Therefore, Samsung expects fourth quarter bit shipments to grow by over 25% QoQ.
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Toshiba
Although Toshiba cut wafer capacity by around 30% in July, due to increased OEM orders from some system product clients in the third quarter the maker was able to move excess inventory from the previous quarter. Furthermore, the output ratio for Toshiba’s new 19nm process technology has already exceeded 70% in late 3Q12; thus, the supplier’s bit shipment volume increased slightly in the third quarter. As NAND flash market supply and demand evened out, Toshiba’s ASP increased by more than 10% QoQ and revenue saw a 12.9% QoQ increase, arriving at 1.21 billion USD, pushing market share to 26.2%. In the fourth quarter, Toshiba will continue to increase the production ratio from the 19nm process to strengthen the maker’s cost competitiveness. Although Toshiba expects to continue seeing inventory restocking demand from OEM clients with new smartphone and tablet PC models hitting the market in the fourth quarter, the supplier plans on flexibly maintaining a 30% or less capacity cut.

Micron
As Micron continually increased the sales ratio of SSD and mSATA products in the previous quarter, the supplier’s ASP fell by 5% QoQ, while bit shipments increased by 6% QoQ. Thus, Micron’s revenue for the previous quarter was 666 million USD, a slight 2.8% QoQ increase, bringing market share to 14.4%. Although Micron anticipates demand from smartphones, tablet PCs and SSD will continue to improve in current quarter, as output from the 20nm process will not increase significantly until the first quarter of 2013, this quarter’s bit output will remain mostly the same as the previous quarter’s figure.

SK Hynix
While affected by appreciation of the Korean won in the third quarter, SK Hynix benefitted from new orders from smartphone and tablet PC OEM clients and production-cut effects in NAND Flash industry. Thus, the supplier’s bit shipments increased by 5% QoQ, while ASP rose by 4% QoQ. Third quarter revenue reached 535 million USD, a 6.4% QoQ increase, representing 11.6% of the market. The output ratio from SK Hynix’s 20nm process has exceeded 50% in late 3Q12, and the supplier will continue to increase 20nm production in the fourth quarter. As SK Hynix expects inventory restocking demand from system product OEM clients will remain good in the fourth quarter, the maker anticipates bit shipment volume will see over 15% QoQ growth.

Intel
Although Intel continued to raise the sales proportion of SSD products in the third quarter, competition is stiffer on the SSD market, and Intel’s ASP fell by about 15% QoQ while bit shipment volume saw about 40% QoQ increase. Third quarter sales rose by 19.7% QoQ to 395 million USD, 8.5% market share. In the fourth quarter, Intel will continue to focus on SSD and mSATA business, in addition to raising the production ratio from the new 20nm process technology.